Don’t Do This Before Buying a Home

apply for a mortgage albany nyBuying a home is an exciting time, but that can lead to some costly errors. Here are a few things you should avoid before buying a home.

Charge it

Your mortgage lender will tell you. Your agent will tell you. You’ll hear it again and again and yet, it still bears repeating. Don’t jump the gun and start charging new furniture. And now is not the time to go out and buy a new truck. New payments will affect your monthly debt-to-income ratio. Hard inquiries on your credit report could hurt your score. Both of these things can lead to a higher interest rate.

Fall behind on bills

While we’re on the topic of finaces, make sure you’re still paying all those bills on time. A late, last minute hit to your credit report before closing can do some serious damage. In fact, one 30-day late payment can knock 60-110 points off your score.

Co-sign on a loan

These is essentially the same as “no new credit!” Co-signing makes you financially liable for someone else’s debt. And even though it’s not YOUR debt, lenders will still have to factor that payment into your monthly finances. Now, someone else’s debt could make it look like you’re stretched too thin.

Don’t change jobs before buying a home

Obviously, a stable job is needed when applying for a mortgage. Lenders may slam the brakes on the whole process if they see that you’re job hopping — especially if you’re jumping into a brand new field. If any changes to your employment occur — even a promotion — keep your loan officer informed.

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